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This quarter, SAP SuccessFactors announced its Managed Payroll Offering. As part of a three-part Q&A, I interviewed Mary Sidlauskas, or Mary Sid as her friends call her, to help us understand the context where Managed Payroll is the best option, migration paths, and maintenance requirements. For more on who Mary is and why she is one of the best resources to help us understand Managed Payroll, please take a read of our first Q&A blog where we talked about the Why, What, and Who of Managed Payroll.

Don’t make the mistake of believing that payroll migration is merely a set of rigorous set of sequenced “processes”. It isn’t. Migrating payroll requires a disciplined methodology; one that our partners have finely tuned based on their years of experience of migrating single instance or multi-country payroll solutions for organizations around the world.

Every migration must start with a complete due diligence overview of the payroll environment. From this, the best migration approach can be determined for your specific needs. Managed payroll is no exception. Keeping with the “stump the chump” Q&A format, Mary spent some time with me to answer the most pressing questions of what you need to know when it comes to migrating to your on-premise payroll solution to a managed payroll environment.

Question Let’s start with due diligence. When it comes to managed payroll migration, what does it mean?
Mary Sid

That’s a great question Patti, as with any implementation project, having a clear and concise view of where you are and where you want get to builds the foundation for a successful project.

 

I think Aitor Vinos, NGA-HR, articulated it best when he told me that “The due diligence exercise begins with a thorough, deep dive into the system environment. This allows us to understand exactly what the requirements are. We detail technical components, like the system landscape, hosting, disaster recovery and interfaces. We also review functional items including company information, structure, module set-up, collective labor agreements, transaction volumes, and system documentation to assess client readiness.”

Question What exactly does the migration to managed payroll entail?
Mary Sid At the highest level, there are two steps:

  1. Build the customer dedicated SAP ERP landscape (Dev, Test and Prod).
  2. Copy the existing SAP ERP system, using our partner’s migration tools and SAP standard and supported copy procedures.

With that said, in my experience there is a lot value in breaking down the processes even further into four distinct steps:

  1. Project Management and Governance, for project management and coordination activities, communication and change management.
  2. Data and configuration migration, utilizing our partner’s migration tools.
  3. Interfaces & Connectivity. HCM systems don’t live in isolation.
  4. Testing and go-live.
Question Is there a project team? Is there a rule of thumb on the types of resources and how many are needed on the project team?
Mary Sid

Yes, a project team will need to be created. The partner will lead project management. An agile steering committee that represents both the client and the partner will make the project decisions.

Client resources will mostly be required to be involved on a part time basis.

The typical client resources that will be involved at differing stages are:

  1. HCM functional lead.
  2. Payroll administrator.
  3. SAP basis team, especially during the actual migration. They would be required to ensure the partner’s consultants have the ability to perform the necessary extracts.
  4. Security and Networking teams, to ensure the new connectivity and firewall rules are created to accommodate the new system.
  5. Resources who need to be involved for specific interface migrations.
  6. Functional Testing Resources.
Question Are there data migration tools available as part of the migration process?
Mary Sid Yes, each partner has proven migration tools that they will use during the process. The use of the data migration tools are included in the migration services fixed fee.
Question You won’t be surprised by my next question… What is the typical project timeline?
Mary Sid You are right. This is probably the most common question in any project like this. And the answer is usually the same. The project timeframe will depend on the complexity of the client’s environment and how fast certain changes can be implemented. A typical migration project should take between 6-10 weeks. Some of the complexities that would extend the timeframe, are multiple 3rd party provider interfaces to migrate, the ERP HCM instance not being in a standalone environment, and/or having multiple instances, i.e. unique instances in multiple countries.
Question Can the SAP Managed Payroll partner literally take an existing deployment and move it without rebuilding configuration and customizations?
Mary Sid Yes, the key benefit of Managed Payroll is that clients don’t need to rebuild their configuration or customizations.
Question Let’s talk money. How much will the partner charge to conduct the initial transition of configuration, programming and data?
Mary Sid The services contract for Managed Payroll is a fixed fee, and will naturally be highly client specific, depending on the complexity of the current HCM landscape, number and complexity of interfaces and other client specific items.
Question Does the partner assume responsibility for changes to interfaces from payroll to banks and benefit providers?
Mary Sid Interfaces are as varied as SAP payroll clients. The migration project will include interface migration, but naturally relevant resources from the client will be required to help coordinate, and sometimes implement, those changes.
Question Does a client’s self-service system need to be updated to point to a different server?
Mary Sid Typically all interfaces need to be updated to point to the new HCM system.
Question What about the client’s integration back to their finance system – who will create and manage that integration?
Mary Sid SAP standard ALE interfaces are used to integrate the HCM and finance systems and this will be part of the migration project. Keep in mind that the client’s SAP basis team might have to make some of the required ALE changes on the finance system.
Question How much testing would be done internally by a clients’s own resources and externally by the partner?
Mary Sid Testing will be a joint effort between the client and the partner. Since there are no configuration changes, very little unit testing should be needed. The testing will focus on regression, interface and end-to-end business process testing. While the regression testing is handled by the partner, the customer must still sign off on the user acceptance testing.
Question What is done to insure that there are no changes to a customer’s payroll processes?
Mary Sid The testing phase will include parallel runs and other standard payroll tests. Since this is the same system that have been running the client’s payroll for many years and there are no configuration changes, there should not be a big risk of incorrect payroll calculation errors. The biggest risk is that some interfaces may fail due to the migration. This is why interface and connectivity testing will be the portion that receives the most attention during the testing phase.
Question Almost done…What are the differences between the migration services that SAP SuccessFactors partners offer?
Mary Sid

That’s a very important question, Patti. EPI-USE and NGA-HR have been partners with SAP SuccessFactors for decades and have probably completed thousands of implementations between the two of them.   They both have perfected their own comprehensive methodology that includes processes, forms, tools and the documentation necessary to successfully complete any client’s migration. I have asked both partners to provide detailed information on their methodology, tools and migration schedule. Customers can find that information at the following links:

EPI-USE http://www.epiuselabs.com/en/cloud-solutions/services/sap-successfactors-managed-payroll

NGA-HR http://www.ngahr.com/blog/step-step-guide-managed-payroll-migration

Question Wow. We have covered a lot. Are there any final thoughts we didn’t cover that are important for clients to consider?
Mary Sid There are. As with any implementation, or migration, the journey for each customer will be a little different. As I stated in the previous interview, it’s extremely important that customers work closely with their SAP SuccessFactors account team to first identify the best partner for their specific needs. Throughout the decision making process the SAP SuccessFactors account team will be responsible to ensure that each customer gets all of their migration questions answered timely and accurately, and they will also ensure that clients receive a detailed migration plan, including all the costs.

 

Thanks for spending some time with us. Mary and I will continue to provide you with valuable content through a mixed media approach including blogs, video interviews, and radio shows on all things payroll so that you can make the best decisions for your payroll implementation.

Stop back here on December 5th for our final Q&A blog about managed payroll focused on maintenance.

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6 Comments

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  1. Jarret Pazahanick

    Thanks for continuing to provide information Mary and after having several calls with SAP/SF my views on the offering have not changed from what I wrote here.

    https://www.linkedin.com/pulse/why-sap-managed-payroll-good-option-most-customers-jarret-pazahanick?trk=pulse_spock-articles

    When customers read the Q&A above pretty easy to see the level of involvement, effort and potential cost for what is being “marketed” as a “simple” “lift and shift”.

    One question Mary – are ALL the master data elements in SAP Time Management configuration and schema rules, SAP Benefits configuration, SAP Payroll configuration and schema rules supported by SuccessFactors Employee Central because if not then customers would have to revisit their set up in Managed Payroll and I can imagine that could be a LOT of work for complex scenarios on potentially both sides (ie SAP Managed Payroll and SF Employee Central).

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    1. Mary Sidlauskas

       

      Thanks Jarret.  I appreciate your feedback, but my intent is not to change your mind on anything. I was receiveng a lot of questions regarding Managed Payroll and wanted to take the opportunity to give a little history on why we felt Managed Payroll could be beneficial to some customers and provide answers to the most common questions.

      As I said in the first blog, https://blogs.sap.com/2016/11/16/10-minutes-with-sap-successfactors-resident-payroll-guru-mary-sidlauskas-qa-on-the-why-what-and-who-of-managed-payroll/, there is no one-size-fits all deployment model and the customer should complete due dilligence prior to moving in any direction.

      We do have many customers running a combination of EC and on-premise payroll with no issues.  “All” is a pretty big word, kind of like “never say never” :), but to date I have not heard of any problems.

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  2. Jarret Pazahanick

    Thanks Mary and I definitely agree that due diligence (as always) will be extra important with this offering as I would hate for customers to assume that “lift and shift” means they will be able to write a small check and move to a SI’s cloud without risk/effort.

    Have a great Thanksgiving.

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  3. Jarret Pazahanick

    “If you’re just going to redeploy your legacy on-premise processes in the cloud, why do it? You’re going to get no value if you’re not going to transform your processes as part of the exercise” from Mike Ettling is spot on in his recent article below.

    http://diginomica.com/2016/11/30/saps-mike-ettling-on-the-cloud-haves-and-have-nots/#comment-33119

    Something else to keep in mind for any customers is they are considering “Managed Payroll” as you are obviously doing none of that on the Payroll side (and potentially time/benefits etc).

    Highly recommend customers read this as also so great tips on how some SI’s are “getting the cloud consulting model” while others are not and that is a very real issue in the ecosystem and something Luke Marson, Bill Kutik and myself discuss here.

    https://www.youtube.com/watch?v=G2QcHN1_fW0 

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